New BRRRR Real Estate Strategy | Valor Lending Group
Would you like to learn about the New BRRRR Real Estate Strategy?
Valor Lending Group has got you covered!
What is BRRRR (buy, rehab, rent, refinance, repeat) and how can I capitalize on this method?
BRRRR is a real estate strategy that involves BUYING distressed investment properties. REHAB the properties. RENT the properties. REFINANCE the properties to pull cash out to purchase more investment properties to REPEAT the process all over again. If done correctly, this method can skyrocket your passive income and grow your real estate schedule to monumental proportions.
B is for BUYING
Investors that use this method shouldn’t buy just any old property. It is important to make sure that you are making a sound investment and that it is a good deal. You want to make sure that you do your research and have a good timeline laid out for how long
renovations will take and when you can get the property rented out. Finding a distress property to purchase is the easy part. It’s the financing that could be the hard. Valor Lending Group has over 100 lenders that specially fund investment Bridge, Fix and Flip,
DSCR, and Construction loans. No matter what level of rehab the property is in, Valor Lending Group can find the right lender for you.
R is for REHAB
Rehabbing a property is the most time-consuming stage of the BRRRR method. Making sure it is safe, habitable, and up to the rental market standards in your area is very critical. There should be some thought about the level of upgrades the property needs depending on its location and market rents. You never want to rehab a property under or over in a specific neighborhood.
When using the BRRRR method you should have a clear scope of work that needs to be done on the property and how much it is going to cost to get it move in ready. You run the chance of losing money if you don’t have a plan of attack when it comes to time and cost.
The main aspects to focus on to receive the highest return on your investment is
updating the kitchen and bathrooms. Also, making sure that there are no hazards.
R is for Rent
Renting your newly rehabbed property to new tenants is one of the most important stages of the BRRRR real estate strategy. This will lock in your passive income and able you to continue your BRRRR method. Many investment property loans are based strictly off of gross monthly rent and the ability to cover the principal, interest, taxes, and insurance payment. Getting the highest and best rental income will become a key factor in the BRRRR equation. See more on financing below.
R is for Refinancing
Refinancing the newly rehabbed property is very important. This will allow you to access equity to purchase more properties to build your SREO. The most common investment property financing is a DSCR loan. DSCR stands for Debt Service Coverage Ratio. The ability to produce enough rent to completely cover their PITI payments. The higher the ratio gets, the easier it becomes for that entity or person to obtain financing for the investment property. DSCR is gross rents divided by new PITI (principal, interest, taxes, and insurance) monthly payment. If your property is collecting rents that covers your current PITI payment your property debt services. This program is excellent for investors due to no taxes or income.
R is for Repeat
Repeat is the final stage of the BRRRR method. Repeat the stages in order to maximize your real estate wealth. When repeating, always take notes during the process so you know what worked and what didn’t on the next round of the BRRRR method.
Fix and Flip Loan Highlights:
- Up to 90/100 (Purchase/Rehab)
- 12 to 24 month terms
- Loan amounts up to $10MM
- No Prepayment Penalty
- Rates starting in the low 9’s*
*Based on best execution, 780+ credit score, 60% LTV, SFR, etc.
DSCR Purchase 15% down, DSCR Rate and Term Refi 80% LTV, DSCR Cash Out Refi 80% LTV, DSCR NO Ratio 75% Purchase/Rate and Term/Cash out
DSCR Investment Property Loan Highlights:
- No Tax Returns
- Employment NOT Required
- No Income Required
- No Debt to Income Ratio Calculated
- Cash Flow based on Subject Property rents | If property is vacant upon purchase market rents from the appraisal will be used to calculate DSCR
- SFR, Condo and 1-4 Unit
- Maximum Loan $6.5M
- Unlimited Financed Properties OK
Whether you’re an avid real estate investor or purchasing your first investment property, the BRRRR method can be used to your advantage.
Your loan can be the next one that I fund!
Standing by for your call NOW!
Recap of our Loan Products:
- Hard Money Loans (20% down / minimal documentation) Typically Fund in 7-10 days.
- Stated Income Loans (Great for business owners and self employed ) No tax returns!
- 100% financing is available (we can cross collateralize other properties if there is enough equity)
- Valor VA Home Loan 100% financing up to $1.5MM
- Investor Cash Flow Loan – No tax returns or DTI calculation! Based on subject property cash flow
- Flipper & Rehab Loans (Flip a property with one of our many options)
- 2nd Position Loans up to $5mm
- Raw Land & Lot Loans
- Ground up Construction for spec homes, custom homes and commercial ground up.
- Farms, Vineyards, Ranches and Agricultural Properties (25-30% down)
- 10% down Jumbo’s up to $1.5mm
- Manufactured Housing / Mobile Homes (20% down / 600+ credit score)
- Acreage Properties
- Commercial Loans up to $500mm
- 3% & 5% down Conventional Loans– LPMI (Lender paid mortgage insurance)
- Foreign Nationals Loans (no social security or residency required)
We also offer:
- 10, 15, 20, 25, 30 year Fixed, Conventional Conforming Loans
- High Balance Conforming aka Super Conforming
- Jumbo’s to $10 Million / 10% down Jumbo to $1.5mm
- FHA, USDA
- ARM’s
- Reverse mortgages up to $1 Million Value
- Refinance including Cash Out
CONTACT ME TODAY for immediate attention to your scenario!
**Rates and terms subject to change without notice**
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